Cyber Crime

INDEX Sr. No. 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 Contents Introduction Cyber Crime In India Cyber Crime Statistics Changing Face of Crime Types of Cyber Crime Other Types of Cyber Crime Classification of Cyber Crime Reasons for Cyber Crime Cyber Criminals Modes And Manners of Committing Cyber Crimes Banking Sector - Introduction Cyber Crimes In Banking Sector Cyber Money Laundering Prevention of Cyber Crime Credit Card Frauds Page No. 1-2 3 4 5 6-10 11-16 17-18 19 20 21-22 23 24-26 27-30 31-32 33-38

Case Study 39 General Tips On Avoiding Possible Internet Fraud 40 Schemes Recent Trends 41 Conclusion Bibliography & Webliography 42 43


Cyber Crime


The usage of internet services in India is growing rapidly. It has given rise to new opportunities in every field we can think of – be it entertainment, business, sports or education. There are many pros and cons of some new types of technology which are been invented or discovered. Similarly the new & profound technology i.e. using of INTERNET Service, has also got some pros & cons. These cons are named CYBER CRIME, the major disadvantages, illegal activity committed on the internet by certain individuals because of certain loop-holes. The internet, along with its advantages, has also exposed us to security risks that come with connecting to a large network. Computers today are being misused for illegal activities like email espionage, credit card fraud, spams, and software piracy and so on, which invade our privacy and offend our senses. Criminal activities in the cyberspace are on the rise. Computer crimes are criminal activities, which involve the use of information technology to gain an illegal or an unauthorized access to a computer system with intent of damaging, deleting or altering computer data. Computer crimes also include the activities such as electronic frauds, misuse of devices, identity theft and data as well as system interference. Computer crimes may not necessarily involve damage to physical property. They rather include the manipulation of confidential data and critical information. Computer crimes involve activities of software theft, wherein the privacy of the users is hampered. These criminal activities involve the breach of human and information privacy, as also the theft and illegal alteration of system critical information. The different types of computer crimes have necessitated the introduction and use of newer and more effective security measures.


Cyber Crime

As India become the fourth highest number of Internet users in the world, cyber crimes in India has also increased 50 percent in 2007 over the previous year. According to the Information Technology (IT) Act, the majority of offenders were under 30 years of age. Around 46 percent of cyber crimes were related to incidents of cyber pornography, followed by hacking. According to recent published 'Crime in 2007 report', published by the National Crime Record Bureau (NCRB), in over 60 percent of these cases, offenders were between 18 and 30. These cyber-crimes are punishable under two categories; the IT Act 2000 and the Indian Penal Code (IPC). According to the report, 217 cases of cyber-crime were registered under the IT Act in 2007, which is an increase of 50 percent from the previous year. Under the IPC section, 339 cases were recorded in 2007 compared to 311 cases in 2006. Out of 35 mega cities, 17 cities have reported around 300 cases of cyber-crimes under both categories that is an increase of 32.6 percent in a year. The report also shows that cyber crime is not only limited to metro cities but it also moved to small cities like Bhopal. According to the report, Bhopal, the capital of Madhya Pradesh has reported the highest incidence of cyber crimes in the country. In order to tackle with cyber crime, Delhi Police have trained 100 of its officers in handling cyber crime and placed them in its Economic Offences Wing. These officers were trained for six weeks in computer hardware and software, computer networks comprising data communication networks, network protocols, wireless networks and network security. Faculty at Guru Gobind Singh Indraprastha University (GGSIPU) were the trainers.


Cyber Crime


As per the National Crime Records Bureau statistics, during the year 2005, 179 cases were registered under the IT Act as compared to 68 cases during the previous year, thereby reporting a significant increase of 163.2% in 2005 over 2004. During 2005, a total of 302 cases were registered under IPC sections as compared to 279 such cases during 2004, thereby reporting an increase of 8.2% in 2005 over 2004. NCRB is yet to release the statistics for 2006. In 2006, 206 complaints were received in comparison with only 58 in 2005, a 255% increase in the total number of complaints received in the Cyber Cell/EOW over the last year. In terms of cases registered and investigated in 2006 (up to 22.12.06), a total of 17 cases, where the computer was the victim, a tool or a repository of evidence, have been registered in the Cyber Cell/EOW as compared to 12 cases registered in 2005. And mind you, these are just the reported cases. While the number of cyber crime instances has been constantly growing over the last few years, the past year and a half, in particular, has seen a rapid spurt in the pace of cyber crime activities. Cyber lawyers, Pavan Duggal, advocate with the Supreme Court of India and Karnika Seth, partner, Seth Associates, Advocates and Legal Consultants, testify to this, pointing out that they have seen a jump in the number of cyber crime cases that they've been handling in the last one year. One also should remember that the term 'Cyber Crime' should be applied to all offences committed with the use of 'Electronic Documents'. Hence, cyber crimes must grow

Cyber Crime at the same rate as the use of the Internet, mobile phone, ATM, credit cards or perhaps even faster. "With the little offences came the larger ones involving huge money and one has seen this Sudden jump from smaller crimes to financial crimes in the last one year." According to Captain Raghu Raman, CEO, Mahindra Special Services Group (SSG), the contributing factors are high volume of data processing, rapid growth and major migration into the online space, especially of financial institutions and their customer transactions. However, actual numbers continue to include, considering the fact that a majority of the cases go unreported. Most victims, especially the corporate, continue to downplay on account of the fear of negative publicity thereby failing to give a correct picture of the cyber crime scene in the country. According to Cyber law expert Na Vijayashankar (popularly known as Naavi); it is difficult to measure the growth of Cyber Crimes by any statistics, the reason being that a majority of cyber crimes don't get reported. "If we, therefore, focus on the number of cases registered or number of convictions achieved, we only get diverted from real facts," he adds. Duggal points out to the results of a survey he conducted in early 2006 on the extent of under- reporting. For every 500 instances of cyber crimes that take place in India, only fifty are reported and out of that fifty, only one is registered as an FIR or criminal case. So, the ratio effectively is 1:500 and this, he points out, are conservative estimates. Giving an insight into the reasons for low reporting, Nandkumar Sarvade, director, Cyber Security and Compliance at Nasscom, points out that very often, people are not aware whether an incident is a cyber crime; there is also lack of awareness on where to lodge a complaint or whether the police will be able to understand. "Added to this is the fear of losing business and hence, many cases don't come to light," he adds


as well as the software used to gain unauthorized access and other evidence of the crime. Decision-makers in business. now credit card frauds. According to Naavi. Researchers must explore the problems in greater detail to learn the origins. certain crimes were noticeable and cyber stalking was one of the first ones. As Seth points out. and motivations of this growing criminal group. pornography." she adds CYBERSPACE As the cases of cybercrime grow. when the Internet boom began. Delhi Police concurs that the cases that are now coming up are more related to financial frauds. There should be electronic surveillance which means investigators tracking down hackers often want to monitor a cracker as he breaks into a victim's computer system. As opposed to obscenity. government. online share trading.Cyber Crime CHANGING FACE OF CRIME The last year has seen a quantum jump not only in the quantity and quality but also the very nature of cyber crime activities. and law enforcement must react to this emerging body of 6|Page . Economic Offences Wing. initially. Cyberspace belongs to everyone. The two basic laws governing real-time electronic surveillance in other criminal investigations also apply in this context. there is a growing need to prevent them. search warrants which means that search warrants may be obtained to gain access to the premises where the cracker is believed to have evidence of the crime. etc. SD Mishra. "However. IPR and Cyber Cell. are becoming more widespread. ACP. with the little offences came the larger ones involving huge money and one has seen this sudden jump from smaller crimes to financial crimes in the last one year. malicious emails that were more prevalent in the past. a perceptible trend being observed is that cyber crimes are moving from 'Personal Victimization' to 'Economic Offences'. Such evidence would include the computer used to commit the crime. methods. phishing attacks.

methods. The founding fathers of internet wanted it to be a boon to the whole world and it is upon us to keep this tool of modernization as a boon and not make it a bane to the society. We should not disclose any personal information on the internet or use credit cards and if we find anything suspicious in e-mails or if the system is hacked. Internet provides anonymity: This is one of the reasons why criminals try to get away easily when caught and also give them a chance to commit the crime again. Computer crime is a multi-billion dollar problem. They must develop policies. In addition. Police Departments should immediately take steps to protect their own information systems from intrusions (Any entry into an area not previously occupied). Therefore.Cyber Crime knowledge. investigate and prosecute the perpetrators. we users should be careful. and regulations to detect incursions. Law enforcement must seek ways to keep the drawbacks from overshadowing the great promise of the computer age. and prevent future crimes. 7|Page . Cybercrime is a menace that has to be tackled effectively not only by the official but also by the users by co-operating with the law. it should be immediately reported to the Police officials who investigate cyber-crimes rather than trying to fix the problem by ourselves.

Some sophisticated offenders loop between PBX systems to evade detection. Additional forms of service theft include capturing "calling card" details and on-selling calls charged to the calling card account. and counterfeiting or illicit reprogramming of stored value telephone cards. There is evidence of telecommunications equipment being used to facilitate organized drug trafficking. as required by the infrastructure of IRC and WWW. 2. these materials can be imported across national borders at the speed of light. 8|Page . gambling. computer hackers in the United States illegally obtained access to Scotland Yard's telephone network and made £620. child pornography and trade in weapons (in those jurisdictions where such activities are illegal). so too are the activities of criminal organizations enhanced by technology. up to 5% of total industry turnover has been lost to fraud (Schieck 1995: 2-5). by fraudulently obtaining an employee's access code. Offenders may gain access to the switchboard by impersonating a technician.000 worth of international calls for which Scotland Yard was responsible (Tendler and Nuttall 1996). By gaining access to an organization‘s telephone switchboard (PBX) individuals or criminal organizations can obtain access to dialin/dial-out circuits and then make their own calls or sell call time to third parties (Gold 1999). The use of encryption technology may place criminal communications beyond the reach of law enforcement. Communications in Furtherance of Criminal Conspiracies Just as legitimate organizations in the private and public sectors rely upon information systems for communications and record keeping. Today. and that more recently. Theft of Telecommunications Services The "phone phreakers" of three decades ago set a precedent for what has become a major criminal industry. It has been suggested that as long ago as 1990. or by using software available on the internet. money laundering. but the activity appears largely confined to individuals. The use of computer networks to produce and distribute child pornography has become the subject of increasing attention. Costs to individual subscribers can also be significant in one case.Cyber Crime TYPES OF CYBER CRIME 1. security failures at one major telecommunications carrier cost approximately £290 million. prostitution. The more overt manifestations of internet child pornography entail a modest degree of organization.

for sale at a lower price. are unable to profit from their creations.4 billion worth of software was lost to piracy in 1993 with $2 billion of that being stolen from the Internet (Meyer and Underwood 1994). 131). Information Infrastructure Task Force 1995. use sophisticated technologies of concealment. to North America. and $690 million in book publishing.2 billion in music. Telecommunications Piracy Digital technology permits perfect reproduction and easy dissemination of print. When creators of a work. codenamed "Operation Cathedral" resulted in approximately 100 arrests around the world. $1. for free distribution. or indeed. According to the Straits Times (8/11/99) A copy of the most recent James Bond Film The World is Not Enough. This has caused considerable concern to owners of copyrighted material. The temptation to reproduce copyrighted material for personal use. Although knowledge is confined to that conduct which has been the target of successful police investigation. Dissemination of Offensive Materials 9|Page . there can be a chilling effect on creative effort generally. Illustrative of such activity was the Wonderland Club.000 images in September. Each year. 4. to Australia. and entail a significant degree of coordination. has proven irresistible to many. and the seizure of over 100.Cyber Crime By contrast. and multimedia combinations. sound. The Software Publishers Association has estimated that $7. it has been estimated that losses of between US$15 and US$17 billion are sustained by industry by reason of copyright infringement (United States. in whatever medium. some of the less publicly visible traffic in child pornography activity appears to entail a greater degree of organization. Ryan (1998) puts the cost of foreign piracy to American industry at more than $10 billion in 1996. Access to the group was password protected. including $1. 3. an international network with members in at least 14 nations ranging from Europe.8 billion in the film industry. 1998. Police investigation of the activity. was available free on the internet before its official release.8 billion in business application software. and content was encrypted. graphics. $3. in addition to financial loss. there appear to have been a number of networks which extend cross-nationally.

In England. Strange men turned up at her home on six different occasions and she received many obscene phone calls. in which persistent messages are sent to an unwilling recipient. In another case a rejected suitor posted invitations on the Internet under the name of a 28. the would-be object of his affections that said that she had fantasies of rape and gang rape. Computer networks may also be used in furtherance of extortion. from the traditional obscene telephone call to its contemporary manifestation in "cyber-stalking".year-old woman. and lost her job (Miller 1999. 1996). financial institutions were reported to have paid significant amounts to sophisticated computer criminals who threatened to wipe out computer systems. Telecommunications systems can also be used for harassing. racist propaganda. among much else. The article cited four incidents between 1993 and 1995 in which a total of 42. One former university student in California used email to harass 5 female students in 1998. graphic sexual descriptions and references to their daily activities.Cyber Crime Content considered by some to be objectionable exists in abundance in cyberspace. The unfortunate couple. along with her name. Miller and Maharaj 1999). residents of Kenosha. The Sunday Times (London) reported in 1996 that over 40 financial institutions in Britain and the United States had been attacked electronically over the previous three years. Investigations also revealed that the suspect was maintaining records about the woman's movements and compiling information about her family (Spice and Sink 1999). who were convinced of the extortionists' capacity to crash their computer systems (Denning 1999 233-4). He bought information on the Internet about the women using a professor's credit card and then sent 100 messages including death threats. This includes. received phone calls and e-mails from strangers as far away as Denmark who said they had seen the photos on the Internet. was afraid to leave her home. June 2. He then communicated via email with men who replied to the solicitations and gave out personal information about the woman. While the woman was not physically assaulted. He apparently made the threats in response to perceived teasing about his appearance (Associated Press 1999a). and instructions for the fabrication of incendiary and explosive devices. threatening or intrusive communications. Wisconsin. sexually explicit materials. address and telephone number.5 million Pounds Sterling were paid by senior executives of the organizations concerned. including her address. One man allegedly stole nude photographs of his former girlfriend and her new boyfriend and posted them on the Internet. phone number. she would not answer the phone. (The Sunday Times. 10 | P a g e . details of her physical appearance and how to bypass her home security system.

means of disrupting the information technology infrastructure of defence systems (Stix 1995). one can easily envisage how traditional countermeasures against money laundering and tax evasion may soon be of limited value.:(Rathmell 1997). Emerging technologies will greatly assist in concealing the origin of ill-gotten gains. While this potential has yet to be realised. Terrorism and Extortion As never before. I can discreetly draw upon these funds as and when I may require.g. Damage to.Cyber Crime 5. I may soon be able to sell you a quantity of heroin. which at the time was seeking its independence from Indonesia (Creed 1999). and of the North Atlantic Treaty Organization during the 1999 bombing of Belgrade (BBC 1999). any of these systems can lead to catastrophic consequences. Electronic Vandalism. in return for an untraceable transfer of stored value to my "smart-card". Legitimately derived income may also be more easily concealed from taxation authorities. With the emergence and proliferation of various technologies of electronic commerce. and have the potential for inflicting massive harm. Whether motivated by curiosity or vindictiveness electronic intruders cause inconvenience at best. western industrial society is dependent upon complex data processing and telecommunications systems. which illustrates the transnational reach of extortionists. which I then download anonymously to my account in a financial institution situated in an overseas jurisdiction which protects the privacy of banking clients. downloading them back to my stored value card (Wahlert 1996). Electronic Money Laundering and Tax Evasion For some time now. or interference with. but can also facilitate the evasion of cash transaction reporting requirements in those nations which have them. a number of individuals and protest groups have hacked the official web pages of various governmental and commercial organizations for e. Large financial institutions will no longer be the only ones with the ability to achieve electronic funds transfers transiting numerous jurisdictions at the speed of light. One case. which have flourished in Asian countries for centuries. Attempts were made to disrupt the computer systems of the Sri Lankan Government (Associated Press 1998). Defence planners around the world are investing substantially in information warfare . This may also operate in reverse: early in 1999 an organized hacking incident was apparently directed at a server which hosted the Internet domain for East Timor. electronic funds transfers have assisted in concealing and in moving the proceeds of crime. The development of informal banking institutions and parallel banking systems may permit central bank supervision to be bypassed. 6. will enjoy even greater capacity through the use of telecommunications. Traditional underground banks. involved a number of German hackers who compromised the system of an Internet service provider in South 11 | P a g e .

Co-operation between US and German authorities resulted in the arrest of the extortionists (Bauer 1998). 7. More recently. to the newest forms of political and industrial espionage. hackers employed by a criminal organization 12 | P a g e .Cyber Crime Florida. deceptive charitable solicitations. From activities as time-honoured as surveillance of an unfaithful spouse. and worldwide telephone lotteries (Cella and Stark 1997 837-844). disabling eight of the ISPs ten servers. Classic pyramid schemes and "Exciting. In 1995. It has been reported that the notorious American hacker Kevin Poulsen was able to gain access to law enforcement and national security wiretap data prior to his arrest in 1991 (Littman 1997). or bogus investment overtures is increasingly common. Illegal Interception of Telecommunications Developments in telecommunications provide new opportunities for electronic eavesdropping. demanded that US$30. and from the privacy of a basement office or living room.000 subscribers. an extortionist in Eastern Europe obtained the credit card details of customers of a North American based on-line music retailer. and published some on the Internet when the retailer refused to comply with his demands (Markoff 2000). The technology of the World Wide Web is ideally suited to investment solicitations. Sales and Investment Fraud As electronic commerce becomes more prevalent. the fraudster can produce a home page that looks better and more sophisticated than that of a Fortune 500 company" (Cella and Stark 1997. The use of the telephone for fraudulent sales pitches. the digital age has been accompanied by unprecedented opportunities for misinformation. and.000 be delivered to a mail drop in Germany. Here again. Low-Risk Investment Opportunities" are not uncommon. technological developments create new vulnerabilities. The electromagnetic signals emitted by a computer may themselves be intercepted. from traditional securities such as stocks and bonds. 822). to more exotic opportunities such as coconut farming. Cyberspace now abounds with a wide variety of investment opportunities. The offenders obtained personal information and credit card details of 10. In the words of two SEC staff "At very little cost. Cables may act as broadcast antennas. Existing law does not prevent the remote monitoring of computer radiation. instantaneously and at minimal cost. 8. telecommunications interception has increasing applications. the sale and leaseback of automatic teller machines. Fraudsters now enjoy direct access to millions of prospective victims around the world. Indeed. communicating via electronic mail through one of the compromised accounts. the application of digital technology to fraudulent endeavours will be that much greater.

Finland. the Netherlands. and the suspect accounts. and Israel. he was arrested during a visit to the United States and subsequently imprisoned. and in disrupting police communications (Rathmell 1997). and so has the risk that such transactions may be intercepted and diverted. Electronic Funds Transfer Fraud Electronic funds transfer systems have begun to proliferate. Valid credit card numbers can be intercepted electronically. a Russian hacker Vladimir Levin. Of course. 13 | P a g e . Another accomplice was caught attempting to withdraw funds from an account in Rotterdam. In 1994. Although Russian law precluded Levin's extradition. Germany. located in Argentina. the digital information stored on a card can be counterfeited. The accomplice was arrested. notified the bank. accessed the computers of Citibank's central wire transfer department. we don't need Willie Sutton to remind us that banks are where they keep the money. The hackers succeeded in gaining police operational intelligence. 55).Cyber Crime attacked the communications system of the Amsterdam Police. as well as physically. Officials from one of the corporate victims. operating from St Petersburg. located in San Francisco. were frozen. and transferred funds from large corporate accounts to other accounts which had been opened by his accomplices in The United States. (Denning 1999. 9.

Cyber Crime 14 | P a g e .

Child Pornography The Internet is being highly used by its abusers to reach and abuse children sexually. Sometimes Pedophiles contact children in the chat rooms posing as teenagers or a child of 15 | P a g e . such as to stealing the credit card information. Motive behind the Crime  Greed  Power  Publicity  Revenge  Adventure  Desire to access forbidden information  Destructive mindset  Wants to sell n/w security services 2. The easy access to the pornographic contents readily and freely available over the internet lowers the inhibitions of the children. They extort money from some corporate giant threatening him to publish the stolen information which is critical in nature. more children would be using the internet and more are the chances of falling victim to the aggression of pedophiles. Government websites are the hot targets of the hackers due to the press coverage. transferring money from various bank accounts to their own account followed by withdrawal of money. HACKING Hacking in simple terms means an illegal intrusion into a computer system and/or network. worldwide.e. The internet is very fast becoming a household commodity in India. Some hackers hack for personal monetary gains. but from Indian Laws perspective there is no difference between the term hacking and cracking. Every act committed towards breaking into a computer and/or network is hacking. and then they try to meet them for sex or to take their nude photographs including their engagement in sexual positions. cracking. it receives.Cyber Crime OTHER TYPES OF CYBER CRIME 1. Pedophiles lure the children by distributing pornographic material. Hackers write or use ready-made computer programs to attack the target computer. Its explosion has made the children a viable victim to the cyber crime. Hackers enjoy the media coverage. There is an equivalent term to hacking i. They possess the desire to destruct and they get the kick out of such destruction. As more homes have access to internet.

 Pedophiles contact children/teens in various chat rooms which are used by children/teen to interact with other children/teen. Stalking in General terms can be referred to as the repeated acts of harassment targeting the victim such as following the victim. who are not advised by their parents or by their teachers about what is wrong and what is right for them while browsing the internet. the pedophiles set up a meeting with the child/teen out of the house and then drag him into the net to further sexually assault him or to use him as a sex object.Cyber Crime similar age. Hence the children are left unprotected in the cyber world. vandalizing victims property.  Gets the e-mail address of the child/teen and starts making contacts on the victim e-mail address as well. The pedophiles then sexually exploit the children either by using them as sexual objects or by taking their pornographic pictures in order to sell those over the internet. making harassing phone calls. then they start becoming friendlier with them and win their confidence. most of the parents do not themselves know about the basics in internet and dangers posed by various services offered over the internet. 3.  Extract personal information from child/teen. leaving written messages or 16 | P a g e . Cyber Stalking Cyber Stalking can be defined as the repeated acts harassment or threatening behavior of the cyber criminal towards the victim by using internet services. Pedophiles take advantage of this situation and lure the children.  At the end of it. How Do They Operate  Pedophiles use false identity to trap the children/teenagers.  Extract personal information from the child/teen by winning his confidence. But in case of cyber world. killing the victims pet. Then starts actual exploitation of the children by offering them some money or falsely promising them good opportunities in life. Then slowly pedophiles start sexual chat to help children shed their inhibitions about sex and then call them out for personal interaction.  Befriend the child/teen.  Starts sending pornographic images/text to the victim including child pornographic images in order to help child/teen shed his inhibitions so that a feeling is created in the mind of the victim that what is being fed to him are normal and that everybody does it. In physical world. parents know the face of dangers and they know how to avoid & face the problems by following simple rules and accordingly they advice their children to keep away from dangerous things and ways.

making sure the victim is aware that he/she is being followed. address of residence and place of work. many times posting notes to the victim. insulting) to get their attention. asking for sexual services or relationships. If stalker is a stranger to victim. the victim may have filled in while opening the chat or e-mail account or while signing an account with some website.  Some stalkers keep on sending repeated e-mails asking for various kinds of favors or threaten the victim. posing as if the victim is posting this information and invite the people to call the victim on her telephone numbers to have sexual services. Stalker even uses very filthy and obscene language to invite the interested persons. start calling the victim at her residence and/or work place.  In online stalking the stalker can make third party to harass the victim. who come across this information. Both kind of Stalkers Online & Offline – have desire to control the victims life.  People of all kind from nook and corner of the World.  The stalker may post this information on any website related to sex-services or dating services. If the stalker is one of the acquaintances of the victim he can easily get this information. daily routine of the victim. He will many times use multiple names when contacting the victim. The letters may love. Many times they will ―flame‖ their victim (becoming argumentative. date of birth etc.  Stalkers will almost always make contact with their victims through email.Cyber Crime objects. family background. who then want to harass the victim because they failed to satisfy their secret desires. Majority of the stalkers are the dejected lovers or ex-lovers. because of which victim starts receiving such kind of unsolicited e-mails. They ―hangout‖ on the same BB‘s as their victim. he collects the information from the internet resources such as various profiles. threaten.  Telephone Numbers of residence and work place. or sexually explicit.  Follow their victim from board to board. Most of the stalkers are men and victim female. How Do They Operate  Collect all personal information about the victim such as name. 17 | P a g e . It all depends on the course of conduct of the stalker.  Some stalkers subscribe the e-mail account of the victim to innumerable pornographic and sex sites. Stalking may be followed by serious violent acts such as physical harm to the victim and the same has to be treated and viewed seriously.

a cyber stalker can easily locate private information about a potential victim with a few mouse clicks or key strokes. such behavior may be a prelude to stalking and violence and should be treated seriously. he will many times make calls to the victim to threaten. there also have been many instances of cyber stalking by strangers. Many stalkers – online or offline – are motivated by a desire to exert control over their victims and engage in similar types of behavior to accomplish this end. stalkers can take advantage of the ease of communications as well as increased access to personal information. As with offline stalking.  Track the victim to his/her home. cyber stalking shares important characteristics with offline stalking. making harassing phone calls. Definition of Cyber stalking Although there is no universally accepted definition of cyber stalking. such as following a person. and sometimes anonymous nature of Internet 18 | P a g e .Cyber Crime  Contact victim via telephone. although there have been reported cases of women cyber stalking men and of same-sex cyber stalking. Most stalking laws require that the perpetrator make a credible threat of violence against the victim. If the stalker is able to access the victim‘s telephone. Although online harassment and threats can take many forms. e-mail. and the cyber stalking begins when the victim attempts to break off the relationship. and still others require only that the alleged stalker‘s course of conduct constitute an implied threat. harass. However. the available evidence (which is largely anecdotal) suggests that the majority of cyber stalkers are men and the majority of their victims are women. As the Internet becomes an ever more integral part of our personal and professional lives. Nature and Extent of Cyber stalking An existing problem aggravated by new technology. the term is used in this report to refer to the use of the Internet. or intimidate them. impersonal. leaving written messages or objects. In addition. others include threats against the victim‘s immediate family. (1) While some conduct involving annoying or menacing behavior might fall short of illegal stalking. the cyber stalker and the victim had a prior relationship. The fact that cyber stalking does not involve physical contact may create the misperception that it is more benign than physical stalking. In many cases. the ease of use and non-confrontational. Stalking generally involves harassing or threatening behavior that an individual engages in repeatedly. or other electronic communications devices to stalk another person. Given the enormous amount of personal information available through the Internet. appearing at a person‘s home or place of business. or vandalizing a person‘s property. This is not necessarily true.

Communications purporting to be from popular social web sites. also referred to as brand spoofing or carding. Phishing email From: *****Bank [mailto:support@****Bank. Put another way. including physical violence. passwords and credit card details by masquerading as a trustworthy entity in an electronic communication. Phishing. and it often directs users to enter details at a fake website whose look and feel are almost identical to the legitimate one. online harassment and threats may be a prelude to more serious behavior. auction sites. he or she may have little hesitation sending harassing or threatening electronic communications to a victim. is a variation on "fishing. and exploits the poor usability of current web security technologies. Phishing In the field of computer security. Attempts to deal with the growing number of reported phishing incidents include legislation. Otherwise we will not be able to verify your identity and access 19 | P a g e . and technical security measures. and the first recorded use of the term "phishing" was made in 1996. user training. Phishing is typically carried out by e-mail or instant messaging. whereas a potential stalker may be unwilling or unable to confront a victim in person or on the telephone. To verify your account information we are asking you to provide us with all the data we are requesting." the idea being that bait is thrown out with the hopes that while most will ignore the bait. phishing is the criminally fraudulent process of attempting to acquire sensitive information such as usernames. some will be tempted into biting. Finally. public awareness. as with physical stalking. A phishing technique was described in detail in 1987. Even when using server authentication. Phishing is an example of social engineering techniques used to fool users. online payment processors or IT Administrators are commonly used to lure the unsuspecting public. it may require tremendous skill to detect that the website is fake.Cyber Crime communications may remove disincentives to cyber] Sent: 08 June 2004 03:25 To: India Subject: Official information from ***** Bank Dear valued ***** Bank Customer! For security purposes your account has been randomly chosen for verification.

jsp ****** Bank Limited Spam Spam is a generic term used to describe electronic 'junk mail' or unwanted messages sent to your email account or mobile phone. Scams The power of the Internet and email communication has made it all too easy for email scams to flourish. Many are related to the well-documented Nigerian Scam or Lotto Scams and use similar tactics in one form or another. Virus Dissemination 20 | P a g e . These schemes often arrive uninvited by email. business information. 4. or processing capacity and secretly gives it to someone else. Thank you.*****bank. bandwidth. These messages vary. https://infinity. Denial Of Service Attack This is an act by the criminal. but are essentially commercial and often annoying in their sheer volume. the number of people claiming to have been defrauded by these scams is relatively low. Please click on the link below to get to the bank secure page and verify your account details. While the actual amount of money lost by businesses and the community is unknown. Spyware Spyware is generally considered to be software that is secretly installed on a computer and takes things from it without the permission or knowledge of the user. who floods the bandwidth of the victim‘s network or fills his email box with spam mail depriving him of the services he is entitled to access or provide. or visit a website where you can make purchases.Cyber Crime to your account will be denied. Spyware may take personal information. It is recognized as a growing problem. They may try to persuade you to buy a product or service. or they may attempt to trick you into divulging your bank account or credit card

End user copying.. 6. 21 | P a g e . It can be done in various ways. usually one with special access privileges. worms. Retail revenue losses worldwide are ever increasing due to this crime. Time bomb. Rabbit and Bacterium are the malicious software‘s). 8. 2. Spoofing Getting one computer on a network to pretend to have the identity of another computer. Logic Bomb. Illegal downloads from the internet etc 7.  They may use the techniques off stenography for hiding the messages. SALE OF NARCOTICS  Sale & Purchase through net  There are web sites which offer sale and shipment off contrabands drugs. so as to obtain access to the other computers on the network.SALAMI ATTACK In such crime criminal makes insignificant changes in such a manner that such changes would go unnoticed. 10. In this case no account holder will approach the bank for such small amount but criminal gains huge amount. 9. Criminal makes such program that deducts small amount like Rs.Cyber Crime Malicious software that attaches itself to other software. Net Extortion Copying the company‘s confidential data in order to extort said company for huge amount. Trojan Horse. Software Piracy Theft of software through the illegal copying of genuine programs or the counterfeiting and distribution of products intended to pass for the original. Hard disk loading. (Virus.50 per month from the account of all the customer of the Bank and deposit the same in his account. Counterfeiting..

1999 to state and federal charges associated with his creation of the Melissa virus. harassment of any one with the use of a computer such as email. Cybercrimes Against Persons Cybercrimes committed against persons include various crimes like transmission of child-pornography. posting.Cyber Crime CLASSIFICATION OF CYBER CRIME Mr. Another example wherein the damage was not done to a person but to the masses is the case of the Melissa virus. attempted to gang-rape her. who is the President of cyber laws. This is one Cybercrime which threatens to undermine the growth of the younger generation as also leave irreparable scars and injury on the younger generation. The Melissa virus first appeared on the internet in March of 1999. It is estimated that the virus caused 80 million dollars in damages to computers worldwide.fifth of the country's largest businesses. In the United States alone. The trafficking. the virus made its way through 1. constitutes one of the most important Cybercrimes known today. who.2 million computers in one. David Smith pleaded guilty on Dec. A minor girl in Ahmadabad was lured to a private place through cyber chat by a man. 9. 22 | P a g e . Pavan Duggal. she was rescued. net and consultant. The potential harm of such a crime to humanity can hardly be amplified. if not controlled. It spread rapidly throughout computer systems in the United States and Europe. in a report has clearly defined the various categories and types of cybercrimes. As some passersby heard her cry. Cybercrimes can be basically divided into 3 major categories: 1. distribution. along with his friends. and dissemination of obscene material including pornography and indecent exposure.

an industry major. The growth of internet has shown that the medium of Cyberspace is being used by individuals and groups to threaten the international governments as also to terrorize the citizens of a country. A Mumbai-based upstart engineering company lost a say and much money in the business when the rival company. They don't contact law enforcement officers when their computer systems are invaded. This crime manifests itself into terrorism when an individual "cracks" into a government or military maintained website.Cyber Crime There are numerous examples of such computer viruses few of them being "Melissa" and "love bug". any public place for the purpose of nabbing cybercriminals and preventing cybercrime. hacking. stole the technical database from their computers with the help of a corporate cyber spy. 2. The Parliament of India passed its first Cyber law. The Act defines five cybercrimes damage to computer source code. 3. without any warrant. The Act also specifies that cybercrimes can only be investigated by an official holding no less a rank than that of Dy. It is common that many systems operators do not share information when they are victimized by crackers. gives draconian powers to the Police to enter and search. These crimes include computer vandalism (destruction of others' property). Superintendent of Police (Dy. Also. It not only provides the legal infrastructure for E-commerce in India but also at the same time. breach of confidentiality and publishing false digital signatures. publishing electronic information which is lascivious or prurient. Cyber terrorism is one distinct kind of crime in this category. transmission of harmful programs. 23 | P a g e . the Indian Cyber law talks of the arrest of any person who is about to commit a cybercrime. preferring instead to fix the damage and take action to keep crackers from gaining access again with as little public attention as possible.SP). Cybercrimes Against Government The third category of Cybercrimes relate to Cybercrimes against Government. the Information Technology Act in 2000. Cybercrimes Against Property The second category of Cybercrimes is that of Cybercrimes against all forms of property.

that can fool biometric systems and bypass firewalls can be utilized to get past many a security system.Cyber Crime REASONS FOR CYBER CRIME Hart in his work ―The Concept of Law‖ has said ‗human beings are vulnerable so rule of law is required to protect them‘. By secretly implanted logic bomb. Complex 24 | P a g e . retina imagers etc. key loggers that can steal access codes. This affords to remove or derive information either through physical or virtual medium makes it much easier. The reasons for the vulnerability of computers may be said to be: Capacity To Store Data In Comparatively Small SpaceThe computer has unique characteristic of storing data in a very small space. advanced voice recorders. 2. Easy To Access The problem encountered in guarding a computer system from unauthorised access is that there is every possibility of breach not due to human error but due to the complex technology. Applying this to the cyberspace we may say that computers are vulnerable (capable of attack) so rule of law is required to protect and safeguard them against cyber crime. 3.

Human mind is fallible and it is not possible that there might not be a lapse at any stage.Cyber Crime The computers work on operating systems and these operating systems in turn are composed of millions of codes. The cyber criminals take advantage of these lacunas and penetrate into the computer system. 25 | P a g e . 5. Loss Of Evidence Loss of evidence is a very common & obvious problem as all the data are routinely destroyed. It is therefore very probable that while protecting the computer system there might be any negligence. Further collection of data outside the territorial extent also paralyses this system of crime investigation. Negligence Negligence is very closely connected with human conduct. 4. which in turn provides a cyber criminal to gain access and control over the computer system.

Cyber Crime CYBER CRIMINALS The cyber criminals constitute of various groups/ category.g. Children And Adolescents Between The Age Group Of 6 – 18 Years The simple reason for this type of delinquent (A young offender) behaviour pattern in children is seen mostly due to the inquisitiveness to know and explore the things. The reason may be to fulfil their political bias. These kinds of hackers are mostly employed to hack the site of the rivals and get credible. Professional Hackers / Crackers Their work is motivated by the colour of money. 3. reliable and valuable information. Further the NASA as well as the Microsoft sites is always under attack by the hackers. 2. Further the reasons may be psychological even. Further they are even employed to crack the system of the employer basically as a measure to make it safer by detecting the loopholes. the Bal Bharati (Delhi) case was the outcome of harassment of the delinquent by his friends. They mainly target the Indian government sites with the purpose to fulfil their political objectives. Organised Hackers These kinds of hackers are mostly organised together to fulfil certain objective. To avenge they normally hack the system of their employee. 26 | P a g e . This division may be justified on the basis of the object that they have in their mind. Other cognate reason may be to prove themselves to be outstanding amongst other children in their group. 4. Discontented Employees This group includes those people who have been either sacked by their employer or are dissatisfied with their employer. E. The Pakistanis are said to be one of the best quality hackers in the world. fundamentalism. The following are the category of cyber criminals1. etc.

which may be an individual or a company or even mail servers there by ultimately resulting into crashing. However the framers of the Information Technology Act 2000 have no where used this term so to avoid any confusion we would not interchangeably use the word hacking for ‗unauthorized access‘ as the latter has wide connotation. Theft Of Information Contained In Electronic Form This includes information stored in computer hard disks. 2. Data Diddling This kind of an attack involves altering raw data just before a computer processes it and then changing it back after the processing is completed. Theft may be either by appropriating the data physically or by tampering them through the virtual medium. Email Bombing This kind of activity refers to sending large numbers of mail to the victim. Unauthorized Access To Computer Systems Or Networks / Hacking This kind of offence is normally referred as hacking in the generic sense. 3. The electricity board faced similar problem of data diddling while the department was being computerised.Cyber Crime MODE AND MANNER OF COMMITING CYBER CRIME 1. removable storage media etc. 27 | P a g e . 4.

Trojan Attacks This term has its origin in the word ‗Trojan horse‘. Distributed Denial of Service (DDS) attack is also a type of denial of service attack. Denial Of Service AttackThe computer of the victim is flooded with more requests than it can handle which cause it to crash. which passively gains control over another‘s system by representing itself as an authorised programme. love bug virus. unlike viruses do not need the host to attach themselves to. They merely make functional copies of themselves and do this repeatedly till they eat up all the available space on a computer's memory. An important feature of this type of offence is that the alteration is so small that it would normally go unnoticed. 9. in which the offenders are wide in number and widespread. the Ziegler case wherein a logic bomb was introduced in the bank‘s system. which deducted 10 cents from every account and deposited it in a particular account. The world's most famous worm was the Internet worm let loose on the Internet by Robert Morris sometime in 1988. Salami Attacks This kind of crime is normally prevalent in the financial institutions or for the purpose of committing financial crimes. They usually affect the data on a computer.g. This implies that these programs are created to do something only when a certain event (known as a trigger event) occurs. E. Almost brought development of Internet to a complete halt.g. Worms. In software field this means an unauthorized programme. Amazon. either by altering or deleting it. which affected at least 5 % of the computers of the globe. E.g. The most common form of 28 | P a g e .Cyber Crime 5. The losses were accounted to be $ 10 million. even some viruses may be termed logic bombs because they lie dormant all through the year and become active only on a particular date (like the Chernobyl virus). E.g. 6. 7. E. Virus / Worm Attacks Viruses are programs that attach themselves to a computer or a file and then circulate themselves to other files and to other computers on a network. Logic Bombs These are event dependent programs. Yahoo. 8.

E. However this case made the police infamous as to their lack of understanding of the nature of cyber crime.S. In this case the site was hacked and the information pertaining to gold fish was changed. E. This may be done for fulfilling political objectives or for money. Colonel Bajwa‘s case. He further harassed this lady. Thus web jacking is a process whereby control over the site of another is made backed by some consideration for it. Internet Time Thefts Normally in these kinds of thefts the Internet surfing hours of the victim are used up by another person. while chatting.the Internet hours were used up by any other person.g. a Trojan was installed in the computer of a lady film director in the U. 11. He may even mutilate or change the information on the site. Web Jacking This term is derived from the term hi jacking.Cyber Crime installing a Trojan is through e-mail. In these kinds of offences the hacker gains access and control over the web site of another. E. 29 | P a g e . recently the site of MIT (Ministry of Information Technology) was hacked by the Pakistani hackers and some obscene matter was placed therein. Another case of web jacking is that of the ‗gold fish‘ case. This was perhaps one of the first reported cases related to cyber crime in India. The cyber criminal through the web cam installed in the computer obtained her nude photographs.g. Further a ransom of US $ 1 million was demanded as ransom. Further the site of Bombay crime branch was also web jacked.g. This is done by gaining access to the login ID and the password. 10.

they may be publicly listed and traded on stock exchanges) and 38 foreign banks.000 ATMs. which in 1935 formally took over these responsibilities from the then Imperial Bank of India. In the lenders case. Through technology development. Banks have become global industrial powerhouses that have created ever more complex products that use risk. 365 days a week. a government-owned bank that traces its origins back to June 1806 and that is the largest commercial bank in the country. Central banking is the responsibility of the Reserve Bank of India. it includes access to loans for the creditworthy. a rating agency. In the case of borrowers.27 public sector banks (that is with the Government of India holding a stake). The Banking Industry at its core provides access to credit. India has 88 scheduled commercial banks (SCBs) . such as verification of account details. After India's independence in 1947. Currently.Cyber Crime BANKING SECTOR The Banking Industry was once a simple and reliable business that took deposits from investors at a lower interest rate and loaned it out to borrowers at a higher rate. The collapse of the Banking Industry in the Financial Crisis. to ensure that there is not another banking system meltdown in the future.000 branches and 17. and in electronically enabled exchanges where everything from stocks to currency futures contracts can be traded. and interest payments on those amounts. at a competitive interest rate.5% respectively 30 | P a g e . the government nationalized the six next largest in 1980. However deregulation and technology led to a revolution in the Banking Industry that saw it transformed. however. through ATMs. banking services have become available 24 hours a day.2% and 6. at online banking. with the private and foreign banks holding 18. Banking in India originated in the last decades of the 18th century. this includes access to their own savings and investments. relegating it to commercial banking functions. 31 private banks (these do not have government stake. The oldest bank in existence in India is the State Bank of India. In 1969 the government nationalized the 14 largest commercial banks. the Reserve Bank was nationalized and given broader powers. Online banking channels have become a key in the last 10 years. the public sector banks hold over 75 percent of total assets of the banking industry. They have a combined network of over 53. as well as advisory services that help individuals and institutions to properly plan and manage their finances. Banking services include transactional services. account balance details and the transfer of funds. According to a report by ICRA Limited. means that some of the more extreme risk-taking and complex securitization activities that banks increasingly engaged in since 2000 will be limited and carefully watched.

has an evil side as well that do not originate from the use of plastic money rather by the misuse of the same. debit cards. travelling bills and even petrol bills. electricity bills. unfortunately. WAYS TO CARD FRAUDS 31 | P a g e . school fees. The use of ATM is not only safe but is also convenient. This has resulted in the increasing use of ATM all over the world. phone bills. etc. insurance premium. The modern contemporary era has replaced these traditional monetary instruments from a paper and metal based currency to ―plastic money‖ in the form of credit cards. The world at large is struggling to increase the convenience and safety on the one hand and to reduce it misuse on the other.Cyber Crime CYBER CRIME IN BANKING SECTOR AUTOMATED TELLER MACHINE The traditional and ancient society was devoid of any monetary instruments and the entire exchange of goods and merchandise was managed by the ―barter system‖. This safety and convenience. This evil side is reflected in the form of ―ATM FRAUDS‖ that is a global problem. The use of monetary instruments as a unit of exchange replaced the barter system and money in various denominations was used as the sole purchasing power. The convenience and safety that credit cards carry with its use has been instrumental in increasing both credit card volumes and usage. The use of plastic money is increasing day by day for payment of shopping bills. This growth is not only in positive use of the same but as well as the negative use of the same.

Card Swapping. 4. is the illegal way of stealing the card‘s security information from the card‘s magnetic stripe. 3. do not use it. 4. choose another . Give other users space to enter their personal identity number (PIN) in private. cancel the transaction and go to another machine. If someone close by the cash machine is behaving suspiciously or makes you feel uncomfortable. which are used to reproduce the card for use at an ATM. go to another machine. Physical Attack. What Precaution Should Be Taken While Leaving Cash Machine 32 | P a g e . Examine the machine for stick on boxes. Later on the criminal removes the card. If someone is crowding or watching you. ATM machine is physical attacked for removing the cash. here a new fictitious site is made which looks authentic to the user and customers are asked to give their card number. Card Skimming. Do not accept help from "well meaning" strangers and never allow yourself to be distracted. PIN and other information. HOW TO USE A CASH MACHINE 1. Website Spoofing. 5. 2. through this customer‘s card is swapped for another card without the knowledge of cardholder. 2. HOW TO USE CASH MACHINE Be aware of others around you.Cyber Crime Some of the popular techniques used to carry out ATM crime are: 1. If you find it difficult to get your card into the slot. Take your card with you. If there is anything unusual about the cash machine report it to the bank and police or the owner of the premises immediately. 3. Stand close to the cash machine and always shield the keypad to avoid anyone seeing you enter your PIN. stick on card entry slots etc. Under no circumstances should members of the public attempt to remove a device as it‘s possible the offender may be nearby.Make sure you check the machine before you use it for any signs of tampering. Be aware of your surroundings. Through Card Jamming ATM‘s card reader is tampered with in order to trap a customer‘s card.

not the telephone number they may give you. Banks need to develop a fraud policy – the policy should be written and distributed to all employees. mini-statement or balance enquiry slip with care. The number of ATM frauds in India is more in regard to negligence of the Personal Identification Number (PIN). Dispose of your cash machine receipt. Always call the person back using the advertised customer telephone number. Do not assume that your bank automatically knows that the machine has withheld your card. If you lose your card in a cash machine. negligence of banks in educating their customers about the matters that should be taken care of while at an ATM. Card Fraud Also Happens In The Home: Cardholders should also be warned of the risks of verifying bank details at home in unsolicited telephone conversations. Tear up or preferably shred these items before discarding them. take your card along to a cash machine and change the number to one that you will be able to remember without writing it down. and more importantly. cancel the card immediately with the card issuer‘s 24-hour emergency line. 1. borrowers and depositors. If you have been given a number that you find difficult to remember. discreetly put your money and card away before leaving the cash machine. Phone your bank instead on their main customer number or access your account using the bank's main website address. NEVER Write Down Your Pin: People make life very easy for pickpockets if they write down their PIN and keep it in their purse or wallet. 33 | P a g e . Again. Do not write down your PIN.Cyber Crime Once you have completed a transaction. Do Not Click On Hyperlinks Sent To You By Email Asking You To Confirm Your Bank Details Online: Hyperlinks are links to web pages that have been sent to you by email and may open a dummy website designed to steal your personal details. which can be found on your last bank statement. Use good antivirus and firewall protection. PREVENTION FOR ATM CARDS Most ATM frauds happen due to the negligence of customers in using. than by sophisticated crimes like skimming. beware of help offered by "well meaning strangers".

Criminals often capture information through ATM skimming – using devices that steal magnetic strip information. There‗s also the helpful bystander (the criminal) who may be standing by to kindly inform you the machine has had problems and offer to help. the attachment slightly protrudes from the machine and may not be parallel with the inherent grooves. At a glance. Even when depositing a cheque at the ATM. the next person can walk up and take it out. Some ATMs allow you to directly deposit checks and cash into your accounts without stuffing envelopes. Minimize your time at the ATM. remove your card and leave the area immediately. If you need to update your records after a transaction. Sometimes.Cyber Crime The most important aspect for reducing ATM related fraud is to educate the customer. Make smart deposits. but not while at the ATM. If you do not feel safe at any time. Look for suspicious attachments. To get that. but it‗s an attachment that captures ATM card numbers. The more time you spend at the ATM. the more vulnerable you are. on should not make/sign the cheque at the ATM. if you think you are being followed. the equipment will even cut off the printed labels on the ATM. compare your records with the account statements or online banking records. 34 | P a g e . the skimmer looks just like a regular ATM slot. make sure they go through – if it gets jammed and it doesn‗t fully go into the machine. Here is a compiled list of guidelines to help your customer from being an ATM fraud victim: 1. 2. go to an area with a lot of people and call the police. As for the envelope-based deposits. one is advised do it at home or office. fraudsters place hidden cameras facing the ATM screen. however. After having made the ATM deposit. The skimmer will not obtain PIN numbers. press the ATM cancel button. After the transaction. 3. To spot one.

Indian Banks Association (IBA) can take lead to kick started. 35 | P a g e . The ATM fraud is not the sole problem of banks alone. depend upon the requirements of the respective banks. It is a big threat and it requires a coordinated and cooperative action on the part of the bank. where total number of installed ATM‘s base is far less than many developed countries. the bank should create awareness among customers about the card-related frauds to reduce the number of frauds in future. There is thus a need to take precautionary and insurance measures that give greater ―protection‖ to the ATMs.Cyber Crime INDIAN SCENARIO In India. It is therefore in the interest of banks to prevent ATM frauds. particularly those located in less secure areas. The ATM frauds not only cause financial loss to banks but they also undermine customers‘ confidence in the use of ATMs. however. But they could increase as more and more ATM‘s will penetrate in the country. ATM-related frauds are very less. This would deter a greater use of ATM for monetary transactions. customers and the law enforcement machinery. The nature and the extent of precautionary measures to be adopted will. In India.

With the entry of Internet commerce. Internet has converted the world into a boundary less market place that never sleeps. At present. Earlier. smart cards like Visa Cash. Internet banking. Monitoring the activities of these institutions in a traditional manner is not possible. whose use is growing can store billions of dollars. in many countries. e-wallet etc. there is no upper limit. businesses and consumers. for example. IT and Internet technologies have reached every nook and corner of the world. From the point of view of law enforcing agencies. non-financial institutions are also permitted to issue e-money. ecash. anonymity and its International nature. This problem is further compounded by the fact that. In some other forms of computer-based e-money. The capacity to transfer unlimited amounts of money without having to go through strict checks makes cyber money laundering an attractive proposition. E-commerce has come into existence due to the attributes of Internet like ease of use. First and foremost. cross-border transactions were controlled by the central banks of respective countries. the jurisdictional technicalities come into play and it is another area that is being exploited by the money launderers. permit transfer of funds electronically between trading partners.Cyber Crime CYBER MONEY LAUNDERING During the past two decades. speed. all the 36 | P a g e . Two individuals also can transfer funds directly using e. They can be effective tools in the hands of money launderers. there is an upper limit imposed by the card issuers but technically there is no limit. transfer of funds can be done between two trading partners directly. Computer networks and Internet.wallets. in particular. As cyber payment systems eliminate the need for face to face interactions. Mondex card. Drug peddlers and organized criminals found a natural and much sought after ally in Internet. This transfer can be done in many ways. the anonymity offered by internet and cyber payment systems is being exploited to the hilt by the criminal elements. They include use of credit cards. Mobile banking and mobile commerce are growing and these technologies have the capability to transfer any amount of money at the touch of a bottom or click of a mouse.

their aims could be to increase the profits by resorting to illegal money transfer etc. MONEY LAUNDERING PROCESS Money laundering is normally accomplished by using a three-stage process. There is a constant fear of getting caught. in almost all cases. E-money and cyber payment systems come in handy in all the three stages of the process. Normally. Further. the launderers also attempt to safeguard their interests. to support new criminal ventures. 1. at the same time. which. While indulging in money laundering process. LAYERING Layering is the second sub process. WHY MONEY LAUNDERING? The most important aim of money laundering is to conceal the origin of the money. People involved in these activities cannot explain the origin and source of these funds to the authorities. Layering and Integration. this is done by opening up bank accounts in the names of non-existent people or commercial organizations and depositing the money. extortion. This is done by breaking up the huge cash into smaller chunks. Money laundering from the point of view of the criminal increases the profits and. is from illegal activity. and also of course. This is used to 37 | P a g e . Placement in cyber space occurs by depositing the illegal money with some legitimate financial institutions or businesses. Cyber payment systems can come in handy during this process. reduces the risk. The three steps involved are Placement. They conceal the origin and ownership of the proceeds. 2. This stage is characterized by facilitating the process of inducting the criminal money into the legal financial system. Criminal resort to this practice to avoid detection of the money by law enforcement which will lead to its confiscation and also may provide leads to the illegal activity. Online banking and Internet banking make it very easy for a launderer to open and operate a bank account. By laundering the money the criminals are trying to close their tracks. maintain control over proceeds and change the form of proceeds. Illegal activities like drug trafficking. generate very volumes of money. So the immediate requirement is to send this money to a different location using all available means. PLACEMENT The first activity is placement. Launderers are very careful at this stage because the chances of getting caught are considerable here. turn out to be great disadvantages while investigating the crimes.Cyber Crime above advantages cyber payments provide to consumers and trading partners. In this complex layers of financial transaction are created to disguise the audit trail and provide anonymity.

As in normal transactions. which are known as safe havens. Normally. Incidents have also come to light where the criminals are using cryptography for hiding their transaction. BUSINESS AREAS THAT SUPPORT OR ARE PRONE TO MONEY LAUNDERING The banks and other financial institution are the most important intermediaries in the money laundering chain. launderers obtain credit cards from some banks or financial institutions located in countries with lax rules. This is the stage in which the ‗cleaned‘ money is ploughed back. the Web-based system then sends an invoice to the customer‘s (who happens to the launderer himself) bank. then. they make use of the banks wherever possible as in the legal commercial activity. This can look and function like any other e-business as far as the outside world is concerned. in the safe haven. stock brokers in the layering process. Launderers normally make use of commodity brokers. the launderer sets up the website for his company and accepts online payments using credit cards for the Purchases made from his company‘s website. This is achieved by moving the names from and to offshore bank accounts in the names of shell companies or front companies by using Electronic Funds Transfer (EFT) or by other electronic means. Another way can be by placing false export import invoices and over valuing goods. The bank then pays the money into the account of the company. and exporting them to a different jurisdiction. The money launderers first activity is to set up an online commerce company which is legal. Every day trillions of dollars are transferred all over the world by other legitimate business and thus it is almost impossible ton as certain whether some money is legal or illegal. As far as the banks are concerned the countries that 38 | P a g e . This is normally accomplished by the launderers by establishing anonymous companies in countries where secrecy is guaranteed. It has come to light that many gangs are opening up the front companies and hiring information technology specialists for nefarious activities. Cyber space provides a secure and anonymous opportunity to the criminals in money laundering operations. INTEGRATION Integration is the third sub process. They can then take loans from these companies and bring back the money. Anyone with access to Internet can start an e-business. The entire process can be explained with the help of an example. 3.Cyber Crime distance the money from the sources. This anonymity is what makes Internet very attractive for the launderers. During this process. As a part of the whole scheme. This way they not only convert their money this way but also can take advantages associated with loan servicing in terms of tax relief. Launderers were also found to purchase high value commodities like diamonds etc. The launderer sitting at home. ‗makes purchases‘ using this credit card from his own website. This is achieved by making it appear as legally earned.

‘ Multinational banks are more vulnerable to money laundering operations.000 criminal customers and they were involved in offenses ranging from financing nuclear weapon programs to narcotics. It is not difficult to see what effect it has on the profitability of banks. It is much easier to launder the money using these methods as there is no physical movement of money. Cyprus. and Switzerland. When BCCI bank was investigated it came to light that there were 3. Hawallah are practiced in India. EFFECTS ON BANKS Almost all the banks trade in foreign exchange Money laundering in any country or economy affects the foreign exchange market directly. Facilitating the activities of launderers even inadvertently can push the banks into problems with law enforcement agencies and also governments. This was observed in UK. The money is paid back in another place on production of the chit. when the banks were privatized the ‗Carli Cartel‘ was reported to have invested heavily and Italian mafia reportedly purchased shares in Italian banks. This only shows the extent of the problem and also that the banks and financial institutions are the primary target of the launderers. In some countries. Berltlot Brecht said. Luxembourg. The offshore accounts of these banks are popular because they offer anonymity and also help in tax evasion. The money laundering reduces the legal volume of the banks business. In some reported cases. This is practiced by different countries by different names. It also causes fluctuations in the exchange rate. Casinos are another business areas that is actively involved in money laundering process. Banking obviously is the most affected sector by the money laundering operations. financing housing schemes. In all the cases the underlying factor is paperless transactions. and then buy a bank. money laundering can undermine the credibility of the banking system. The second area is underground banking or parallel banking. Futures and commodity markets are another area which is found to be facilitating the money laundering. Under this system. the banks survival has come under threat. It was also found that launderers do take advantages of privatization in various countries by investing in them. These practices mostly work on trust and mostly controlled by mafia in many countries. Other financial institution like fund managers and those facilitating Electronic Fund Transfer are also being manipulated by the launderers. antique dealers and jewelers. In fact. Further. casinos. The other areas include professional advisers. even political parties organizations are known to be using laundered money for their campaigns. China follows a system called ‗Fic Chin‘. money is deposited in one country and the depositor is handed a chit or chop. 39 | P a g e . ‗If you want to steal.Cyber Crime are considered safe for launderers are Cayman Islands. India and Columbia. In Columbia. Similar systems known as Hundi.

Because cyber money laundering can be done from anywhere in the world without any jurisdiction. A few years before that. There may be attempts to gain political power either directly or indirectly like Coli Cocoine Cartel‘s attempt in supporting Columbian President. The low regulation by central banks will become difficult and consequently. this can result in increased crime rate. there will be rise in inflation. Further. violence in society. the Indian Government was so short of foreign exchange that it had to pledge gold in the London bank. Money laundering can help in spread of parallel economy. before his arrest during 1993. One needs not be an economist understands the impact of money laundering on economies of developing countries. overall income distribution in an economy is likely to get affected. This incident also shows how the national economy gets affected. 40 | P a g e . an Indian national in one year handled US 81. the effects are much severe. which will result in loss to national income due to reduced tax collections and lost jobs. On the social plane. Samper in 1996 elections.5 bn illegal transactions.Cyber Crime OTHER EFFECTS In one incident.

It is very important to keep the records of the customer for a sufficient time. By working in close conjunction with them. at least for 8 to 10 years.Cyber Crime PREVENTION OF CYBER CRIME Because of the nature of Cyber money laundering. Cyber money laundering has to be dealt with at organizational [Bank or Financial Institution]. In UK. which could be cumulated by others. However. AT ORGANIZATIONAL [BANK] LEVEL The banking and other financial organizations can reduce the quantum of money laundering by following the guidelines issued by central banks of respective countries in letter and spirit. no country can effectively deal with it in isolation. The legal provisions regarding ‗knowing the customer‘ brought down the crime to a great extent. The old principle of ‗Knowing the customer‘ well will help a great deal. AT NATIONAL LEVEL Some countries liken UK have taken proactive steps to control this crime. deposit taking institutions (including banks) are expected to report suspicious transactions to the law enforcement authorities. Further. Any suspicious activities must be reported to law enforcement authorities. working in close association with other banks and exchange of information and intelligence in this regard will be definitely helpful. They empowered their customs officials to seize cash consignments 41 | P a g e . national and international levels. Having an eye on suspicious deals can give early warnings on the impending trouble. Law enforcement agencies have details of criminal elements and their transactions. Developing internal control mechanisms is very essential in this regard. banks must keep in mind the legal provisions regarding privacy of individuals. bank can have early warning on such activities.

Hong Kong has passed similar laws.000 pounds or more. AT INTERNATIONAL LEVEL The UN has taken the lead and during 1995 international community meeting signed a convention known as ‗UN Convention Against Illict Traffic in Narcotic Drugs and Psychotropic Substances‘. Some of the suggested measures are putting an upper limit on the amount of payment and frequency of using e-money in peer to peer transfers 42 | P a g e . transfers to and from financial system and cross-border flows of cash. The biggest source of money laundering funds comes from drug trade and the volume of money is large. They are points of entry of cash into financial system. In order to cover this vast amount of money they need financial services industry. the group of seven industrialized nations established ‗Financial Action Task Force‘ (FATF). US have stringent laws in dealing with Cyber money laundering. this convention made money laundering a crime and provided a model. Many countries have enacted some stringent laws to control this crime. Further. The most important issues at national level are establishing legal framework and training law enforcing officials. if the investigating authorities have strong evidence that the money has come from illegal activities of drug trafficking. The single most important issue is harmonizing the terrestrial laws with cyber laws. the UN also organized another convention against transnational organized crime. Issue of electronic money by private parties is another factor. As a result of UN the efforts.Cyber Crime of 10. less than 1% money laundered in cyber space is ever detected or criminals prosecuted. UK. Financial Action Task Force (FATF) had noticed some critical points in the modus operandi of criminals which are difficult for the launderers to avoid. through legislation. as in some countries regulation of these people is not effective. Paying attention to these issues can help in controlling cyber laundering to a considerable extent. They eye financial institutions that are in the business of accepting deposits from customers. Prevention of money laundering in cyber space is proving to be really a daunting task. According to financial crimes enforcement network of US. The Council of Europe has passed Criminal Justice Act. Many other countries are following suit. The major weapon to combat this crime is controlling financial transactions including e-transactions. Slowly. different countries are realizing the importance of this issue and enacting suitable rules aimed at providing transparency in transactions carried out by these institutions. Courts also permit confiscation of cash. During 2000. After studying this phenomenon.

while identity theft had been holding steady for the last few years. But it was only until the establishment of standards for the magnetic strip in 1970 that the credit card became part of the information age.a "buy now. Credit card fraud is also an adjunct to identity theft. Babylon and Egypt 3000 years ago. In the 1920s. decreased as a percentage of all ID theft complaints for the sixth year in a row. According to the Federal Trade Commission. Diners Club and American Express launched their charge cards in the USA. fraud in the United Kingdom alone was estimated at £535 million. pay later" system . However. The word credit comes from Latin. In 1950.was established in the 14th century. The first use of magnetic stripes on cards was in the early 1960's.was introduced in the USA.Cyber Crime CREDIT CARDS FRAUDS INTRODUCTION TO CREDIT CARDS Credit was first used in Assyria. meaning ―TRUST‖. The first advertisement for credit was placed in 1730 by Christopher Thornton. or US$750-830 million at prevailing 2006 exchange rates. when the London Transit Authority installed a magnetic stripe system. tallymen sold clothes in return for small weekly payments. who offered furniture that could be paid off weekly. Paper money followed only in the 17th century. The bill of exchange . credit card fraud. They were called "tallymen" because they kept a record or tally of what people had bought on a wooden stick. In 1951. that crime which most people associate with ID theft. The fraud begins with either the theft of the physical card or the compromise of data associated with the account. San Francisco Bay Area Rapid Transit installed a paper based ticket the same size as the credit cards in the late 1960's. Diners Club issued the first credit card to 200 customers who could use it at 27 restaurants in New York. or to obtain unauthorized funds from an account. a shopper's plate . Debts were settled by one-third cash and two-thirds bill of exchange.the forerunner of banknotes . It could only be used in the shops which issued it. including the card account number or other information that would routinely and necessarily 43 | P a g e . One side of the stick was marked with notches to represent the amount of debt and the other side was a record of payments. The purpose may be to obtain goods without paying. From the 18th century until the early part of the 20th. the first "plastic money". it saw a 21 percent increase in 2008. The cost of credit card fraud reaches into billions of dollars annually. In 2006. CREDIT CARD FRAUD Credit card fraud is a wide-ranging term for theft and fraud committed using a credit card or any similar payment mechanism as a fraudulent source of funds in a transaction.

the merchant or the bank. Other countries generally have similar laws aimed at protecting consumers from physical theft of the card. The only common security measure on all cards is a signature panel. This method may deter casual theft of a card found alone. However. it remains usable until the holder notifies the bank that the card is lost.S. The compromise can occur by many common routes and can usually be conducted without tipping off the card holder. such as a driver's license.Cyber Crime be available to a merchant during a legitimate transaction. Still. it is possible for a thief to make unauthorized purchases on that card up until the card is cancelled. it may be trivial for the thief to deduce the information by looking at other items in the wallet. regardless of the amount charged on the card. kiosks.) are common targets for stolen cards. but if the card holder's wallet is stolen. but signatures are relatively easy to forge. etc. In the United States. to verify the identity of the purchaser. a U. as there is no way to verify the card holder's identity. For instance. and asking for such verification may be a violation of the merchant's agreement with the credit card companies. a large transaction occurring a great distance from the card holder's home might be flagged as suspicious. including sophisticated real-time analysis that can estimate the probability of fraud based on a number of factors. a thief could potentially purchase thousands of dollars in merchandise or services before the card holder or the bank realize that the card is in the wrong hands. federal law limits the liability of card holders to $50 in the event of theft. IF CARD IS STOLEN When a credit card is lost or stolen. Banks have a number of countermeasures at the network level. For example. Many merchants will demand to see a picture ID. A simple example is that of a store clerk copying sales receipts for later use. The rapid growth of credit card use on the Internet has made database security lapses particularly costly. Self-serve payment systems (gas stations. The merchant may be 44 | P a g e . such as the user's ZIP or postal code. most banks have toll-free telephone numbers with 24hour support to encourage prompt reporting. in some cases. in practice. In the absence of other security measures. and some credit cards include the holder's picture on the card itself. millions of accounts have been compromised. the card holder has a right to refuse to show additional verification. many banks will waive even this small payment and simply remove the fraudulent charges from the customer's account if the customer signs an affidavit confirming that the charges are indeed fraudulent. A common countermeasure is to require the user to key in some identifying information. at least until the account is ultimately used for fraud. driver license commonly has the holder's home address and ZIP code printed on it.

and merchant banking systems offer simple methods of verifying this information. can be highly useful to a thief as additional card holder verification. The card holder may not discover fraudulent use until receiving a billing statement. to decline the transaction. making it difficult to identify the source of the compromise. but they are not required to check identification and they are usually are not involved in processing payments for the merchandise. as well Internet merchants who provide online services. CNP 45 | P a g e . since the cost of research and prosecution usually far outweighs the loss due to fraud. meaning that the card is not physically available for the merchant to inspect. or even to hold the card and refuse to return it to the customer. The industry term for catalog order and similar transactions is "Card Not Present" (CNP). telephone or over the Internet when the cardholder is not present at the point of sale. whether by mail. Account numbers are often embossed or imprinted on the card. Compromised Accounts Card account information is stored in a number of formats. Shipping companies can guarantee delivery to a location. It is difficult for a merchant to verify that the actual card holder is indeed authorizing the purchase. smaller transactions generally undergo less scrutiny. but the most common include:     Name of card holder Account number Expiration date Verification Many Web sites have been compromised in the past and theft of credit card data is a major concern for banks. Data obtained in a theft. A common preventive measure for merchants is to allow shipment only to an address approved by the cardholder. like addresses or phone numbers. and a magnetic stripe on the back contains the data in machine readable format. and are less likely to be investigated by either the bank or the merchant. Fields can vary. Stolen cards can be reported quickly by card holders. which may be delivered infrequently.Cyber Crime instructed to call the bank for verification. Mail/Internet Order Fraud The mail and the Internet are major routes for fraud against merchants who sell and ship products. The merchant must rely on the holder (or someone purporting to be the holder) to present the information on the card by indirect means. Additionally. but a compromised account can be hoarded by a thief for weeks or months before any fraudulent use.

Alternatively. It is typically an "inside job" by a dishonest employee of a legitimate merchant. The replacement card is then used fraudulently. and can be as simple as photocopying of receipts. first by gathering information about the intended victim. The skimmer will typically use a small keypad to unobtrusively transcribe the 3 or 4 digits Card Security Code which is not present on the magnetic strip. and they pay higher rates to merchant banks for the privilege of accepting cards. Customers expect to be able to use their credit card without any hassles. but these have not met with much success. they may create counterfeit documents. Merchants can implement these prevention measures but risk losing business if the customer chooses not to use the measures. then contacting their bank or credit issuer .masquerading as the genuine cardholder — asking for mail to be redirected to a new address. Skimming Skimming is the theft of credit card information used in an otherwise legitimate transaction. Account Takeover There are two types of fraud within the identity theft category: 1. Application Fraud Application fraud occurs when criminals use stolen or fake documents to open an account in someone else's name.Cyber Crime merchants must take extra precaution against fraud exposure and associated losses. Criminals may try to steal documents such as utility bills and bank statements to build up useful personal information. where they ask the buyer to send a copy of the physical card and statement to ensure the legitimate usage of a card. 2. and have little incentive to pursue additional security due to laws limiting customer liability in the event of fraud. Some merchants added a new practice to protect consumers and self reputation. Anonymous scam artists bet on the fact that many fraud prevention features do not apply in this environment. 46 | P a g e . The criminal then reports the card lost and asks for a replacement to be sent. Common scenarios for skimming are restaurants or bars where the skimmer has possession of the victim's credit card out of their immediate view. Account Takeover Account takeover involves a criminal trying to take over another person's account. Merchant associations have developed some prevention measures. such as single use card numbers.

and the thief does not need to purchase an actual product. Nowadays. Another variation would be to take false card numbers to a location that does not immediately process card numbers. The bank collects a list of all the card holders who have complained about fraudulent transactions. These devices are often used in conjunction with a pinhole camera to read the user's PIN at the same time. the 3 to 4 digit Card Security Code and/or the card's expiry date. that merchant's terminals (devices used to authorize transactions) can be directly investigated. The purchase is usually for a small monetary amount. In the past. ranging from large fines to complete exclusion from the merchant banking system. If the card is processed successfully. which can be a death blow to businesses such as restaurants which rely on credit card processing. if many of the customers used one particular merchant. this process is no longer viable due to widespread requirement by internet credit card processing systems for additional data such as the billing address. The thief presents the card information on a website that has real-time transaction processing. and penalties for merchants can be severe in cases of compromise. carders used computer programs called "generators" to produce a sequence of credit card numbers. carding is more typically used to verify credit card data obtained directly from the victims by skimming or phishing. which reads the magnetic strip as the user unknowingly passes their card through it. Skimming is difficult for the typical card holder to detect. and then uses data mining to discover relationships among the card holders and the merchants they use. such as a trade show or special event. 47 | P a g e . However. Merchants must ensure the physical security of their terminals. a Web site subscription or charitable donation would be sufficient. and also to avoid attracting the bank's attention. but given a large enough sample. CARDING Carding is a term used for a process to verify the validity of stolen card data. as well as the more prevalent use of wireless card scanners that can process transactions right away. both to avoid using the card's credit limit. the thief knows that the card is still good. A website known to be susceptible to carding is known as a cardable website. The specific item purchased is immaterial. and then test them to see which were valid accounts. For example. SKIMMER Sophisticated algorithms can also search for known patterns of fraud.Cyber Crime Instances of skimming have been reported where the perpetrator has put a device over the card slot of a public cash machine (Automated Teller Machine). it is fairly easy for the bank to detect.

glued. Have another look at the card‘s signature panel. it could be that the credit card is stolen and the person has changed the signature to his or her own. (The holograms on credit cards that have not been tampered with will show clear.215. Check the security features of the credit card. If the signature on the credit card is smeared. And while 'no-card' fraud is growing. I. The credit card loss total for 2007 was $304. credit card fraud cost US merchants 2. Market price for a phish ranges from US$1. or covered with white tape) are an indication of credit card fraud. 4. 3. Whether you have a brick-and-mortar business or an online one. according to the RCMP.00 depending on the type of card. Examine the signature on the card.664. freshness of the data and credit status of the victim PREVENTION FOR CREDIT CARD FRAUD Credit card fraud is bad business. A carder will typically sell data files of phish to other individuals who will carry out the actual fraud. ―Ghost images‖ of other numbers behind the embossing are a tip-off that the card has been re-embossed. Check the credit card‘s embossing. compare the signatures as well to those on any other ID presented. Credit card fraud prevention when dealing with credit card customers face-to-face 1.9 million dollars (Celent Communications). In 2004. painted.00 to US$50. credit card fraud is costing you money. Compare signatures. such as a driver‘s license or other photo ID. too. Credit card fraud is a significant problem in Canada. erased.255. Ask for and check other identification. 48 | P a g e . Besides comparing the signature on the credit card with the person‘s signature on the credit card slip. Check to see if the ID has been altered in any way as a person trying to use a stolen credit card may also have stolen or fake ID. The hologram may be damaged.Cyber Crime A set of credit card details that has been verified in this way is known in fraud circles as a phish. most credit card frauds are still being committed using lost. It should show a repetitive colour design of the MasterCard or Visa name. stolen or counterfeit cards.) II. Altered signature panels (those that are discoloured. three-dimensional images that appear to move when the card is tilted. 2.

Cyber Crime 5. credit card fraud prevention strategies such as scrutinizing the credit card aren‘t going to work. When dealing with credit card customers over the phone or through the Internet. If the shipping address and the billing address on the order are different. Be wary of multiple transactions made with similar card numbers in a sequence. call the customer to confirm the order. however. rush or overnight. 3. 6. 5. This is the shipping of choice for many credit card fraudsters. 2. 7. to ensure that no one can steal the credit card information and help prevent future credit card fraud. Check the presented card with recent lists of stolen and invalid credit card numbers. 4. you still have the credit card. 7. 49 | P a g e . Ask for a ―Code 10‖ if you have reason to suspect a possible credit card fraud. For information on the suspicious behavior that may indicate someone trying to commit credit card fraud. That way if the customer runs away while you‘re making the call. You can. be alert to suspicious behaviors and shape your credit policies to nip credit card fraud in the bud. In such a case. Be wary of unusually large orders. ask the customer for an ISP (Internet Service Provider) or domain-based e-mail address that can be traced back. Be wary of orders shipped to a single address but purchased with multiple cards. 6. 1. It‘s also very important to be sure that your staff is educated about credit card fraud. Destroy all carbon copies of the credit card transaction. Call for authorization of the credit card – remembering to take both the credit card and the sales draft with you. Call the customer to confirm the order first. Be wary of orders you‘re asked to ship express. You can use the points above as a ―to do‖ list for dealing with credit card transactions. Don‘t process credit card orders that originate from free e-mail addresses or from e-mail forwarding addresses. You may even want to make it a policy to ship only to the billing address on the credit card. see Suspicious Behaviors That May Indicate Credit Card Fraud. such as a possible counterfeit or stolen card. Don‘t process credit card orders unless the information is complete.

This test should be first to be that it is applied to any credit card number one process. Mod10 is an algorithm that will show whether the card number being presented is valid card number and is within the range of numbers issued by credit card companies. 50 | P a g e . Be wary of overseas orders – especially if the order exhibits any of the characteristics noted above. you can cut down your credit card fraud losses. 9. but by establishing and following procedures to check every credit card transaction.Cyber Crime 8. If the card fails Mod10 one can safely assume fraud. Credit card fraud may not be entirely preventable. It cannot give any other details like no. issued by any other company. The first is Mod10 algorithm testing.

he had walked away with Rs 50. Manwani is an MBA drop-out from a Pune college and served as a marketing executive in a Chennai-based firm for some time. They floated a new site which resembled that of a reputed telecom companies. but in the process parted with their PINs. were ready to give him credit card numbers of a few American banks for $5 per card. On receipt of large-scale complaints from the billed credit card users and banks in the United States.5 lakh knocked off from two ATMs in T Nagar and Abiramipuram in the city. it is reliably learnt.Cyber Crime CASE STUDY INDIA'S FIRST ATM CARD FRAUD The Chennai City Police have busted an international gang involved in cyber crime. with the arrest of Deepak Prem Manwani (22). The site also offered the magnetic codes of those cards. That company has millions of subscribers. While browsing the Net one day. several lakh subscribers logged on to the site to get back that little money. sitting somewhere in Europe. Apparently. he had with him Rs 7. The police are on the lookout for those persons too. Interestingly. the police stumbled upon a cyber crime involving scores of persons across the globe. Manwani also managed to generate 30 plastic cards that contained necessary data to enable him to break into ATMS. or simply enter into a deal on a booty-sharing basis.000 from an ATM in Mumbai.75 per head which. Armed with all requisite data to hack the bank ATMs. At the time of his detention. his audacious crime career started in an Internet cafe. The dimensions of the city cops' achievement can be gauged from the fact that they have netted a man who is on the wanted list of the formidable FBI of the United States. he got attracted to a site which offered him assistance in breaking into the ATMs. Believing that it was a genuine offer from the telecom company in question. He was so enterprising that he was able to sell away a few such cards to his contacts in Mumbai. His contacts. the FBI started an 51 | P a g e . Prior to that. While investigating Manwani's case. Meanwhile. Manwani and many others of his ilk entered into a deal with the gang behind the site and could purchase any amount of data. but charged $200 per code. the site promoters said. The fake site offered the visitors to return $11. of course on certain terms. The operators of the site had devised a fascinating idea to get the personal identification number (PIN) of the card users. had been collected in excess by mistake from them. who was caught red-handed while breaking into an ATM in the city in June last. the gang started its systematic looting.

But the city police believe that this is the beginning of the end of a major cyber crime. Manwani has since been enlarged on bail after interrogation by the CBI. 52 | P a g e .Cyber Crime investigation into the affair and also alerted the CBI in New Delhi that the international gang had developed some links in India too.

may not have the brand-name recognition of longestablished companies.doesn't mean it's"). Be Careful About Giving Out Valuable Personal Data Online If you see e-mail messages from someone you don't know that ask you for personal data . Watch Out for "Advance-Fee" Demands In general. 2. credit-card number.such as your Social Security number. to set up a professional-looking Web site means that criminals can make their Web sites look as impressive as those of legitimate e-commerce merchants. Criminals have been known to send messages in which they pretend to be (for example) a systems administrator or Internet service provider representative in order to persuade people online that they should disclose valuable personal data. of course. using the Internet to research online companies that aren't known to you is a reasonable step to take before you decide to entrust a significant amount of money to such companies. at minimal cost. 4. Legitimate startup "dot. and still be fully capable of delivering what you need at a fair price. 53 | P a g e . you should be highly wary about relying on advice that such people give you if they are trying to persuade you to entrust your money to them.don't just send the data without knowing more about who's asking. The ready availability of software that allows" companies. Even so. Don't Judge by Initial Appearances It may seem obvious. As a result. you need to look carefully at any online seller of goods or services who wants you to send checks or money orders immediately to a post office box. or uses an e-mail header that has no useful identifying data (e. that may be an indication that the person doesn't want to leave any information that could allow you to contact them later if you have a dispute over undelivered goods for which you paid. 3. "W6T7S8@provider. or password . but consumers need to remember that just because something appears on the Internet .Cyber Crime GENERAL TIPS ON AVOIDING POSSIBLE INTERNET FRAUD SCHEMES 1. before you receive the goods or services you've been promised. Be Especially Careful About Online Communications with Someone Who Conceals His True Identity If someone sends you an e-mail in which he refuses to disclose his full matter how impressive or professional the Web site looks .

. according to security vendor Trustwave." The company advised banks to scan their ATMs to see if they're infected. "The malware contains advanced management functionality allowing the attacker to fully control the compromised ATM through a customized user interface built into the malware. which would potentially allow criminals to clone the card in order to withdraw cash. a group of criminals used counterfeit ATM cards to steal $9 million from 130 ATMs in 49 cities around the world all within a time period of 30 minutes. Trustwave has collected multiple versions of the malware. 54 | P a g e .Cyber Crime RECENT TRENDS 11. reboot the machine and even uninstall the malware. The trigger card causes a small window to appear that gives its controller 10 seconds to pick one of 10 command options using the ATM's keypad. The malware records the magnetic stripe information on the back of a card as well as the PIN (Personal Identification Number). print card data. can be printed out by the ATM's receipt printer. according to a Trustwave report. 10:00 AM — IDG News Service — Cybercriminals are improving a malicious software program that can be installed on ATMs running Microsoft's Windows XP operating system that records sensitive card details. The malware is controlled via a GUI that is displayed when a so-called "trigger card" is inserted into the machine by a criminal. Trustwave wrote. A criminal can then view the number of transactions.The malware has been found on ATMs in Eastern European countries. Another menu option appears to allow the ejection of an ATM's cash cassette. The collected card data. The company believes that the particular one it analyzed is "a relatively early version of the malware and that subsequent versions have seen significant additions to its functionality. which is encrypted using the DES (Data Encryption Standard) algorithm." Trustwave wrote.

This helps criminals to find new areas to commit the fraud. as in the physical world the goals of law enforcement are balanced with the goals of maintaining personal liberty and privacy. 55 | P a g e . Credit card fraud can be committed using a credit card or any similar payment mechanism as a fraudulent source of funds in a transaction. By the time regulators come up with preventive measures to protect customers from innovative frauds. where it is changing very fast. either the environment itself changes or new technology emerges. Computer forensics has developed as an indispensable tool for law enforcement.‖ This quote exactly reflects the present environment related to technology. Cyber space and cyber payment methods are being abused by money launderers for converting their dirty money into legal money. or to obtain unauthorized funds from an account. The purpose may be to obtain goods without paying. But in the digital world.Cyber Crime CONCLUSION Lastly I conclude by saying that ―Thieves are not born. but made out of opportunities.

com 56 | P a g e Crime BIBLIOGRAPHY WEBSITE: SEARCH ENGINE: www. 57 | P a g e .yahoo.Cyber Crime SEARCH ENGINE:

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